October’s sales were 0.4 per cent ahead of an upwardly-revised September
figure and 3.4 per cent ahead of the same month last year – the biggest
year-on-year rise since May 2008 at the beginning of the recession.

Total sales over the festive season will decline because of low levels of housing transactions that will affect home-related sales, deflation in categories such as electricals, and the capacity that has come out of the market from retail failures over the past year, the consultancy Verdict said.

Markets had expected a rate hike in the third quarter of 2010 with borrowing
costs standing at 1.5 per cent or more by the end of the year – but the
Bank’s forecasts say inflation will undershoot the 2 per cent target if this
happens.

An additional Â£25bn was approved by the Bank’s Monetary Policy Committee, less than the Â£50bn expected in some quarters: some Â£175bn has been expended since the policy was launched in March. At that point the Bank indicated that it thought Â£75bn might be sufficient to create more demand, avoid a slump and, in due course, bring inflation back to the official 2 per cent target. Interest rates were pegged for the ninth successive month at 0.5 per cent, their lowest in the Bank’s 315-year history.

As it was, it seems that just about every bit of the economy was down, including the largest single element of it, private sector services. The green shoots of growth, such as they were, seem to have failed to take root.

The group, which saw pre-tax profits rise 1.5 per cent in the six months to
August 29, generated total sales of more than Â£1 billion a week at Â£30.4
billion. Like-for-like sales rose 2.7per cent in the UK – slower than the
growth achieved by its rivals.

Finance director Andrew Bonfield said: “If cocoa prices stay at their current level, there will be no choice but to increase the price of chocolate.”

But he admitted that the company has already decreased the size of bars abroad to keep prices below key levels which would deter buyers. “For example, in Australia, we’ve relaunched Cadbury’s Dairy Milk in a new pack size. We were able to use price points and the promotional strategy as a way of actually realising higher prices without necessarily a headline price increase,” he said.

Just one problem. Inflation, as measured by the Consumer Price Index, hasn’t yet fallen below 1 per cent, which would trigger a letter of explanation about missed targets from the Bank to the Chancellor, let alone into deflation territory. Indeed, we learnt yesterday that inflation did not fall at all last month.

The cost of a funeral with cremation over the same period has gone up by 15 per cent to pounds 1,024. Those price jumps compare with a 7 per cent increase in inflation during that time. Burials in south-east England cost 22 per cent more than the average and half as much again as the south- west, the cheapest region.